The court established that the recovery of excess amount paid to an employee can be permissible, but if there has been no fraud or misrepresentation on the part of the employee, the recovery at a belated stage would result in great hardship.

1. - The instant writ petition has been filed for restraining the respondents from making recovery vide impugned order dated 15.2.99 (Annexure- I).

2. The facts of the case are not in dispute. Petitioner had wrongly been given the higher pay scale and when the respondents could find out that mistake, they rectified it and passed the appropriate order, fixed the petitioner strictly in accordance with law and for the past amount, they passed the impugned order for making a recovery to the tune of Rs. 37,501/- from the petitioner.

3. As petitioner himself admits that it was by mistake and the respondents have a right to rectify the said mistake and have done it, the only question is : whether the money paid to him without any fault on the part of the petitioner, can be permitted to be recovered? In support of his contention, petitioner has placed reliance upon the judgment of the Supreme Court in Sahib Ram v. State of Haryana, 1995 Suppl (1) SCC 18 , wherein the Hon'ble Apex Court has observed as under:

"The principal erred in granting him the relaxation. Since the date of relaxation the appellant had been paid his salary on the revised scale. However, it is not on account of any misrepresentation made by the appellant that the benefit of the higher pay scale was given to him but by wrong construction made by the Principal for which the appellant cannot be held to be at fault. Under the circumstances the amount paid till date may not be recovered from the appellant."

4. In Shyam Babu Verma v. Union of India, (1994) 2 SCC 521 , the Hon'ble Apex Court considered the similar case and held that if the employee has received the extra money due to no fault of him and that scale is reduced subsequently with effect, from back date, it shall only be just and proper not to recover any excess amount which has already been paid to him. This Court, in Nand Lal v. R.S.E.B. (1999) 2 Rajasthan LR 707 , has passed the same order.

5. In V. Ganga Ram v. Regional Joint Director (1997) 6 SCC 139 , the Apex Court held that if the amount has been paid by mistake, the recovery can be made of the excess amount. However, in Union of India v. Ram Gopal Aggrawal, (1998) 2 SCC 589 , the Apex Court has held that if the amount had been paid by mistake, and there has been no fraud or misrepresentation on the part of the employee, the recovery at a belated stage would result in great hardship. Therefore, in such circumstance, the amount already paid to him, even under the interim order of the Court, be not recovered.

6. In all these aforesaid cases, one thing becomes clear that the employer has a right to rectify the mistake and to recover the excess amount paid.

7. The above referred to orders of the Hon'ble Supreme Court seem to have been passed under Article 142 of the Constitution of India and none of them lays down the law having binding effect as passed under Article 141 of the Constitution. But in the facts and circumstances of those cases, when the cases were considered on the basis of legal submissions raised therein and the Court realised that though the employees were not entitled for the said amount but had been paid, in exercise of the powers under Article 141 of the Constitution, the Hon'ble Supreme Court restrained the Authorities to recover the said amount. More so, if the employer is not permitted to recover the said amount in law, it would nullify the concept of rectification of mistake and render the system of audit to nugatory. it would result in a wind-fall gains to the employee and would amount to unjust enrichment.

8. In K.S. Satyanarayan v. V.R. Narayana Rao (1999) 6 SCC 104 , the Hon'ble Supreme Court has held that juristic basis for such an order of recovery, even if not based on contract or tort, may fall on another category of quasi-contract or restitution. The Hon'ble Supreme Court, while deciding the said case, approved and followed two decisions of English Courts, namely, Fibrosa v. Fairbairn (1942) 2 All. ER 122 and Nels